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An NSW man with a total judgment debt of $790,000 has been granted permission to view files held by a law firm to determine whether he has grounds to pursue negligence proceedings.
CJM Lawyers has been ordered by the NSW Supreme Court to allow Darko Kovac to inspect files related to proceedings brought against him by the Tweed Shire Council for alleged breaches of the Environmental Planning and Assessment Act 1979.
With the intention of preserving the firm’s interests, Kovac and his legal team are permitted to attend the firm’s offices to inspect the files, but are not allowed to photocopy or take the documents away.
Kovac, a co-owner of two blocks of land in Kunghur in northern NSW and co-trustee of the “Trust Trust”, was sued in his personal capacity as trustee. At one point during proceedings, CJM Lawyers allegedly took over the carriage of his matter from another firm of solicitors.
Kovac submitted that he did not provide any instructions to CJM, did not enter into a costs agreement, and was not kept appraised of, “and indeed was unaware of what happened”, in the proceedings.
Despite this position, Kovac said he is liable to two costs judgments – the first being a $500,000 order in favour of Tweed Shire Council, and the other a $290,000 judgment debt owed to CJM Lawyers.
He submitted that he requires preliminary discovery from CJM of any existing documents “that may assist in determining whether he is entitled to pursue a claim in negligence”, with the loss said to be costs payable to the council and any costs payable to the firm.
Kovac added that without the documents, “he is left to speculate about what documents may be in the solicitor’s file, and how it came about that the solicitor purported to act for him without any instructions”.
CJM opposed the application on the basis that Kovac was unable to obtain sufficient information to decide whether or not to commence proceedings. Further, the firm argued that Kovac has not identified how inspecting the documents could assist him with this task.
Justice Richard Cavanagh said the issue between Kovac and CJM was complicated by the “very unusual circumstances” in which the firm allegedly came to be acting for Kovac, and the “unusual circumstances” in which Kovac came to be liable for costs.
CJM submitted that the judgment debt against Kovac’s co-trustee in respect of the $290,000 in legal costs is, in reality, a debt to which Kovac is jointly and severally liable. As he remains a trustee, Kovac is allegedly “prima facie liable to pay the debts of the Trust Trust”.
“The importance of these matters, that is, these matters relating to the relationship between the plaintiff and his co-trustee and the nature of his obligations for the purpose of this application, is that the matter is not so simple as being an ordinary client alleging that he never provided instructions to his solicitor,” Justice Cavanagh said.
The senior judge said the documents would be relevant to any determination of whether Kovac has a prospective claim.
“Whilst it is important that applications for preliminary discovery are not used as some sort of fishing exercise or to determine whether there might be any matters of credit which might impact upon a case which might be pursued by the plaintiff, preliminary discovery may be given in circumstances in which there may be what I will describe as an absolute defence,” Justice Cavanagh said.
“In other words, preliminary discovery may be given if it will assist a prospective plaintiff to understand whether there may be an obvious or strong basis on which the plaintiff could not possibly succeed.”
Citation: Kovac v CJM Lawyers Pty Ltd t/as CJM Lawyers [2026] NSWSC 620.
